VMW Jumps 11%: Q2 Beats, Q3 View In-Line, Raises Year View

By Tiernan Ray

Enterprise “virtualization” software maker VMware (VMW) this afternoon reportedQ2 revenue and profit that topped analysts’ estimates, offered an in-line revenue forecast for this quarter, and raised the top end of its forecast revenue range for the year.

Revenue in the three months ended in June rose 11%, year over year, to $1.24 billion, yielding EPS of $79 cents.

Analysts had been modeling $1.23 billion and 77 cents.

CEO Pat Gelsinger called the quarter “strong” and said the company sees “a significant market opportunity in the second half of 2013.”

For the current quarter, the company forecast revenue in a range of $1.27 billion to $1.30 billion, about in line with the consensus of $1.29 billion.

For the full year, VMware raised the top end of its revenue outlook to a range of $5.12 billion to $5.26 billion from the prior forecast range of $5.12 billion to $5.26 billion.

VMware stock is up $6.81, or 10%, at $78.09 in late trading.

Update: On a conference call following the report, Gelsinger talked of $50 billion in opportunity the company sees from three areas, “software-defined data center,” “hybrid cloud,” and “end-user computing.”

Chief operating officer Carl Eschenbach noted that the company had a “strong quarter for bookings,” with results “in line or above expectations in all three of our geographic regions.”

VMware shares are up $7.74, or almost 11%, at $79.02 in late trading.

Shares of EMC (EMC), which owns most of VMware stock, are up $1.06, or 4.2%, at $26.39 in late trading.

About Tech Trader Daily

Tech Trader Daily is a blog on technology investing written by Barron’s veteran Tiernan Ray. The blog provides news, analysis and original reporting on events important to investors in software, hardware, the Internet, telecommunications and related fields. Comments and tips can be sent to: techtraderdaily@barrons.com.